Abstract
Globalization is a hotly debated empirical phenomenon. Two aspects of globalization are discussed particularly frequently: The extent to which globalization leads to convergence, and the impact of globalization on inequality within and across countries. This chapter argues that it is worthwhile to look at firms in a disaggregated manner to address these research problems. So far, globalization research has mostly looked at firms as an amorphous mass of actors. This can be traced to the two classic schools of thought, Marxism and liberalism, which both conceptualize capitalism as a single and expanding system, ultimately leading to convergence. As corollary, companies are regarded as mostly sharing dominant strategies and practices. This renders them uninteresting for research. In contrast, versions of capitalism in the plural, as developed in comparative capitalisms literature, maintain that there is continued diversity between countries as well as between firms. Such arguments are supported by empirical evidence in management and international business studies. This suggests paying closer attention to firms in a disaggregated manner to understand globalization processes. This chapter proposes to conceptualize organizations as actors caught in structure: Firms are agents in today’s globalized world, but at the same time they face strong and often contradictory pulls exerted by the different contexts in which their activities are embedded. The emerging picture reveals firms situated within the complex and dynamic interdependence of structure and agency. The way this materializes is far from determined, yet highly relevant in answering issues of convergence and inequality, and thus provides a promising agenda for globalization research.
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Notes
- 1.
This is not to say that there might not be good reasons for this somehow selective perspective. Theoretical approaches need to decide what to focus on, and what aspects of a certain phenomenon to disregard. They also always are stylized in one way or another. One can make the case for looking primarily at the economy. However, this comes at a certain cost. What I argue in this chapter is that this cost is rather high for globalization studies, as a more fine-grained analysis could potentially yield interesting and relevant insights into global processes.
- 2.
- 3.
It is important to remember that these are ideal-typical conceptualizations. In empirical reality, one will always find a certain mix of different forms of coordination.
- 4.
Comparative capitalisms literature is often accused of functionalism and economic reasoning. There is certainly some truth to this, in particular if compared to more sociological approaches of institutionalism which tend to put emphasis on legitimacy, as opposed to efficiency. And arguing on the basis of performance levels at the aggregate level overlooks significant patterns of inequality within market economies. However, seen in historical perspective, it was quite a normative argument to make in the late 1990s and early 2000s that a coordinated (or social democratic) form of capitalism delivers equally strong growth figures as the at the time much championed liberal form. In fact, the notion of complementarities suggests that CMEs should not implement liberal reforms in order not to lose their distinct comparative institutional advantage – a bold and quite political statement to make at the time, as CMEs were under intense pressure to implement reforms to further deregulate and liberalize their economies.
- 5.
A concrete example is the recent attempt of the German carmaker Volkswagen to introduce a works council at its U.S. plant in Chattanooga, TN. The failure of this attempt, however, suggests the difficulty involved in transferring organizational practices across great institutional distance.
- 6.
These terms are meant to be somewhat similar in their terminology and meaning to those of oversocialized and undersocialized views of the economy as used in economic sociology (Granovetter 1985). In fact, it seems to me that this is yet another dimension of the highly relevant and popular debate about the relationship between the social and the economic lifeworld, in this case the one between organizations and their institutional environment.
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Fortwengel, J. (2015). Agents Caught in Structure: Organizations, Globalization, and Inequality. In: Lenger, A., Schumacher, F. (eds) Understanding the Dynamics of Global Inequality. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-662-44766-6_13
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